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Poland's mass privatization program

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  • R. Puntillo
  • D. Ipsen

Abstract

This paper analyses three corporate finance aspects of Poland's proposed mass privatization program (MPP): design feasibility, incentive systems employed and initial valuation method of the selected state-owned enterprises (SOEs). Also discussed are critical corporate governance issues that will in part determine the ultimate success of Poland's unique approach to mass privatization. Poland's MPP is designed to privatize en masse over 400 mid-to-large size Polish SOEs. In the mid-1995, Poland's MPP installed 15 specially designed national investment funds (NIFs) as core investors in each of the 400+ privatized firms. NIFs, which are like high-powered Western mutual funds, have hired consortia of Polish-foreign fund managers or advisors to help restructure the target operating companies over the next ten years. The stated goal of the MPP Law — and the key basis of fund managers' incentive compensation — is to increase shareholder value in the former SOEs through restructuring.

Suggested Citation

  • R. Puntillo & D. Ipsen, 1996. "Poland's mass privatization program," The European Journal of Finance, Taylor & Francis Journals, vol. 2(1), pages 41-55.
    • Handle: RePEc:taf:eurjfi:v:2:y:1996:i:1:p:41-55
    DOI: 10.1080/135184796337599
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    References listed on IDEAS

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    5. Wendy Carlin & John Van Reenen & Toby Wolfe, 1995. "Enterprise restructuring in early transition: the case study evidence from Central and Eastern Europe1," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 3(4), pages 427-458, December.
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    Cited by:

    1. Wolfgang Aussenegg, 1999. "Going Public in Poland: Case-by-Case Privatizations, Mass Privatization and Private Sector Initial Public Offerings," William Davidson Institute Working Papers Series 292, William Davidson Institute at the University of Michigan.

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